What Is Marketing?

Economics of Marketing

2

Chapter Objectives

Define marketing.

Explain the marketing concept.

Define demographics.

Explain the marketing mix.

Explain economics and free enterprise.

Identify intellectual property rights.

Explain the different types of business ownership.

Explain the economic impact of sports and entertainment.

3

The Importance of Sports and

Entertainment Marketing

The sports and entertainment industries have

become two of the most profitable industries in the

United States.

4

Marketing Defined

Because of competition, an

organized marketing plan

is essential.

marketing the process

of developing, promoting,

and distributing products,

or goods and services, to

satisfy customers’ needs

and wants

5

Goods are tangible items,

such as sports equipment.

Services are intangible

products, such as theater

tickets.

Marketing and the Marketing

Concept

Marketing Core Functions

Marketing Defined

Successful organizations

follow a marketing

concept.

marketing concept idea

that organizations need to

satisfy their customers

while also trying to reach

their organizations’ goals

7

The first step in creating a

marketing concept involves

identifying the market.

market potential

customers with shared

needs who have the

desire and ability to buy a

product

Marketing Defined

Organizations spend lots of

money to learn about their

customers needs and

wants.

8

Having a clear picture

about the target market

makes developing a

marketing plan easier to

accomplish.

target market specific

group of consumers that an

organization selects as the

focus of its marketing plan

needs a lack of basic

necessities such as food,

clothing, or shelter

wants things that people

desire based on

personality, experiences, or

information about a product

Marketing Defined

The United States census

provides useful information

about the demographics

of our nation.

9

demographics statistics

that describe population

in terms of personal

characteristics

Businesses use

demographic information to

develop their marketing

plans.

The Marketing Mix

Marketers use a tool to

develop strategies called

the marketing mix.

10

marketing mix a

combination of four basic

strategies known as the

4 Ps—product, price,

place, and promotion

To be effective, all 4 Ps in a

marketing plan must focus

on the target market.

The Marketing Mix

Marketing mix strategies

involve product, price,

place, and promotion

decisions.

11

channel of distribution

path a product takes from

the producer to the

consumer

Place decisions include

determining a channel of

distribution.

P

P

P

P

The Marketing Mix—The Four Ps

12

involve the goods, services, or ideas used to

satisfy consumer needs.

Product

Decisions

involve the exchange process between the

customer and the seller.

Price

Decisions

involve making the product available to the

customer.

Place

Decisions

involve how the goods or services are

communicated to the consumer.

Promotion

Decisions

Operating an e-tail business on an electronic channel—the Web—can be costly, due to design, delivery, returns, and operating expenses. Though Many larger dot-com companies crashed in the 1990’s, small stores like Harris Cyclery of West Newton, Massachusetts, actually increase sales using a basic Web site. Today, a third of Harris’s bicycle business rides in on the Web to get hard-to-find parts and personal service. Describe an e-business’s home page to your class after viewing one through marketingseries.glencoe.com.

Buzz Power

13

The influence of buzz is so powerful that researchers monitor

consumer opinions online. Positive buzz can increase profits

for products, books, films, TV, music, and fashion, and

determine popularity of athletes and celebrities. With public

resistance to banner ads and pop-ups, a little buzz “zooms”

a long way.

For more information on sports and entertainment marketing,

go to marketingseries.glencoe.com.

“Word-of-mouth ramped up to warp

speed” is one definition of Internet buzz,

says BusinessWeek. It’s the marketing

by-product of e-mail, instant messaging,

bulletin boards, and chat rooms.

Economic Basics

The economics of

marketing sports and

entertainment have a great

impact globally as well as

locally.

14

economics the study

of the choices and

decisions that affect

making, distributing, and

using goods and services

A measure of economic

growth is the gross

domestic product (GDP).

GDP (gross domestic

product) the value of all

goods and services

produced within a country

Economic Basics

Profit allows companies to

stay in business.

15

profit the money left

after all costs and

expenses of a business

are paid

competition as a

characteristic of free

enterprise, the struggle

among companies for

customers

As with most businesses,

there is a financial risk

involved with sports and

entertainment events.

Competition is the basis of

the free enterprise system.

Property Ownership and

Intellectual Property Rights

Inherent in the free enterprise system is the right to own property and start a business.

16

Intellectual property rights

are protected by the

following:

Copyrights

copyright legal

protection of a creator’s

intellectual property or

products

Patents

Trademarks

Types of Business

Ownership

Types of business ownership include:

17

Sole proprietorship

Partnership

Corporation

Subchapter S Corporation

Locations benefit economically from sports and/or

entertainment events and marketing.

On a local level, sporting events and entertainment

venues economically impact areas in which they

operate because they draw audiences.

Hosting the Olympics has a huge economic impact

on a region before, during, and after the event.

18

Economic Impact

Explain the concept of economics.

What are three characteristics of a free

enterprise system?

What is the economic impact of sports and

entertainment events on a community?

1.

2.

3.

19

Define and give an example of the term marketing.

20

Explain the marketing

concept.

Describe the concept of

demographics.

Marketing is the

process of

developing,

promoting, and

distributing

products, or goods

and services, to

satisfy customer

needs and wants.

1. The marketing

concept states that

organizations need

to satisfy their

customers while

also trying to reach

their organization’s

goals.

2. Demographics are

statistical

characteristics that

help describe

people and target

markets.

3.

Explain the marketing

mix.

The marketing mix

is a combination of

product, price,

place, and

promotion

decisions.

4.

Checking Concepts

1.

2.

3.

4.

continued

Explain the concept of

economics.

21

Name four types of

business ownership.

Define intellectual

property rights.

Economics is the

study of the

choices and

decisions that

affect making,

distributing, and

using goods and

services.

5. The four types of

business

ownership are sole

proprietorship,

partnership, limited

partnership, and

corporation.

6. Intellectual property

rights are intangible

and are protected

by patents,

copyrights, and

trademarks.

7.

Checking Concepts

5.

6.

7.

continued

Describe how sports and

entertainment impact

national and local

economies.

22

Critical Thinking Sports and

entertainment local

events draw audiences.

That means workers are

needed for crowd

control, ticket collection,

concession sales, and

security. These

customers may also hire

local people to work for

them. Nationally, events

that increase tourism

contribute to the GDP.

8.

Checking Concepts

8.

23

End of